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J.P. Morgan Chase in London is in the market with a roughly E5 billion deal for French beverage company Pernod Ricard, backing the company's $3.15 billion purchase of part of the Seagram Spirits and Wine Business from Vivendi Universal. A banker familiar with the deal said Société Générale is acting as mandating arranger on the deal, which is expected to close this week. The banker said J.P. Morgan Chase is looking for commitments between E250-350 million for underwriting positions. He said the deal has been well received as Pernod Ricard has a number of leading brands in its beverage portfolio.

Oft-traveled supply-side economist Larry Kudlow has left ING-Barings to form an economics-consulting group. Kudlow declined to specify the reasons for the departure, and provide specifics of the new venture, but an executive at ING-Barings points to the firms uncertain future as a cause for the departure, with the firms well publicized inability to find a buyer all but sealing its doom. ING-Barings was Kudlow's third stop in the last several years; he had previously worked at Schroeder & Co., and buyside asset-manager and life insurer American Skandia.

Standard & Poor's has assigned a B+ rating to Linc.net Inc.'s $230 million secured credit facility because of the financial constraints on the credit. Joel Levington, associate director at S&P, observed that the revolver is only $30 million. "Whereas before they had more flexibility for working capital and to pursue their business plan, they're somewhat limited today than they would've been with the old facility," he explained. "They were a different company when that facility was assigned. There were four acquisitions they had on their letters of intent, and due to lack of finance opportunities, they had to let those four acquisitions go." The new facility is indicative of what they could get from the credit markets, Levington said. Linc.net, based in Miami, Fla., provides a variety of network infrastructure services, including central office installation, network infrastructure engineering, and last-mile deployment. Daniel Harrington, cfo, did not return calls for comment.

Credit Suisse First Boston and J.P. Morgan Chase will syndicate $5 billion of the $6 billion credit they launched on behalf of defense contractor Northrop Grumman. Sources close to the deal say at least $1 billion of the credit will be held by the banks to provide bridge financing for the company as it plans an upcoming bond offering for at least $1 billion. "They're doing a bond deal because there's not a lot of depth in the pro rata market right now," said one banker, explaining that the change was made in light of a more favorable environment for the company in the bond market.

Comptroller of the Currency John Hawke urged lenders not to turn away creditworthy borrowers despite concerns regulators have about balance sheet problems. He recalled how a decade ago the Office of The Comptroller of the Currency reacted very sharply after national banks got into lending difficulties in the Northeast. The banking system is in far better shape now than it was then, he said. Hawke spoke at a meeting on financial services modernization sponsored by the American Law Institute and the American Bar Association.

Denbury Resources recently added an additional $40 million to its existing $110 million revolving credit facility to fund the acquisition of C02 Assets. "We're seeing it as a strategic play that can give us control of the price and availability of CO2 at Little Creek Field," saidPhil Rykhoek, cfo of Denbury, a Texas-based oil company which focuses on Mississippi, Louisiana, and the U.S. Gulf Coast.

About $250 million of bank debt from companies wrestling with asbestos litigation traded last week as dealers banked on credit restructuring and a shorter litigation process. The bank debt of Owens Illinois' and Owens Corning last week jumped 10 points and nearly 20 points, respectively. About $50 million of Owens Illinois traded in the high 80s, and as much as $200 million of Owens Corning traded in ranges from 40 to 56. Dealers cited Bear Stearns as one of the biggest players in the two names, but traders there declined to comment. Officials at the companies did not comment by press time.

Bankers last week speculated that the agents on the $775 million Performance Materials credit might move money from the pro rata portion of the deal to the "B" tranche, which was devoured. Credit Suisse First Boston and Deutsche Bank are leading the deal supporting AEA Investors and DLJ Merchant Banking's leveraged buyout of Performance Material. The $410 million institutional blew out within a week, and bankers said given the general malaise in the pro rata market, an adjustment on the $365 million pro rata portion of the deal might be on order.

A $10 million piece of Allied Waste's "B/C" tranche traded at 99 1/4 last week, following a presentation company officials gave at Morgan Stanley Dean Witter's high-yield conference in Florida. "It's no coincidence that the conference ended Wednesday, and there were six trades on Friday," said a dealer who attended the conference. "The buyside funds were there and saw it." He added that company's continued popularity has helped nudge up levels. "It's just a popular name. Everybody wants it. Everybody has a core position. The [waste hauling] industry makes people nervous, but the company itself has a good story."

A $3 million piece of AMI Semiconductor traded at 100 1/2 - 3/4 as the company's reputation as a good credit continues to help levels. "They're just a well-run company with well-run management," said a dealer. Another trader commented that there tends to be "inherent risk in lending to a technology company." On a positive note, he added that the structure of the deal is good and leverage is low. AMI, based in Pocatello, Idaho, provides digital and mixed-signal application specific integrated circuits. Credit Suisse First Boston leads the $175 million deal, which was recently signed.

Has the Bear Stearns European credit research team gone out to breakfast? The head of the department, Phil Crate, says the group had "a mind blowing experience" that ended in the revamping of the look of its morning briefing, as well as getting a chance to poke fun at the team's new U.S. paymasters. Their morning notes are now called the Bagel Bar, and feature a large cup of coffee and two bagels with the words 'credit' and 'news' on them, and can be found on investors' computers everywhere. The team recently switched from BNP Paribas. "I like the new look," says Esperanza Duncan, analyst at J.P. Morgan Asset Management in London. "But, the truth is I would have read it even if it didn't feature the food because I like their research."